Bakkt, Inc. (BKKT)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of financial condition and results of operations should be read together with the accompanying consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 (this "Report") and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (our "Form 10-K"), which is incorporated herein by reference.

References in this section to “we,” “us,” “our,” “Bakkt” or the “Company” and like terms refer to Bakkt, Inc. and its subsidiaries for the three and six months ending June 30, 2026, unless the context otherwise requires. Our consolidated results include the operations of Distributed Technologies Research Global Ltd ("DTR") from May 1, 2026, following completion of the acquisition on April 30, 2026. References to the acquired business are made only where necessary to describe the transaction, historical periods, or related accounting matters; since the completion of the acquisition, DTR's people, technology, products and transaction activity are part of Bakkt.

Some of the information contained in this discussion and analysis, including information regarding our plans, strategy, product development, commercial pipeline, expected launches, target markets, investments and future financial or operating performance, includes forward-looking statements. These statements are based on management's current beliefs, assumptions and information and are subject to risks and uncertainties. Actual results could differ materially from those contemplated by the forward-looking statements. Factors that could cause or contribute to such differences include those discussed under "Cautionary Note Regarding Forward-Looking Statements" and "Item 1A. Risk Factors" in this Report and in our other filings with the United States Securities and Exchange Commission (the "SEC").

In this section and elsewhere in this Report, we use the following terms, which are defined as follows:

•"Client" means a business with which we contract to provide services to customers on our platform, including financial institutions, financial technology firms, digital asset companies, hedge funds, merchants, retailers and other businesses. In the notes to our consolidated financial statements, the term "customer" is used as required by Financial Accounting Standards Board Accounting Standards Codification Topic 606, Revenue from Contracts with Customers ("ASC 606").

•"Customer" means an individual or business end user of a client's service that transacts through our platform, unless the context refers to a customer for purposes of ASC 606.

•"Digital asset" means an asset that is created, issued, recorded or transferred using blockchain or distributed ledger technology, including digital asset currencies, stablecoins and other digital tokens. We use "digital asset," "virtual currency," "digital asset currency," "coin" and "token" as contextually appropriate.

•"Platform" means the technology, infrastructure, software, compliance capabilities and related services through which we provide our products and services.

Overview

General

Bakkt is a regulated financial technology company that builds and operates infrastructure for digital asset trading, programmable finance and cross-border payments. During 2025, we substantially completed a strategic transformation that included divesting non-core businesses, simplifying our corporate and capital structure and focusing our resources on a unified digital financial infrastructure platform. During the first half of 2026, we continued that transformation by completing our acquisition of an agentic payments and stablecoin platform, integrating that technology into our platform and advancing strategic investments in Japan and India.

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Our platform strategy is organized around three complementary business engines - Bakkt Markets, Bakkt Agent and Bakkt Global - supported by a common stablecoin-enabled settlement, compliance and onboarding foundation. Markets provides the regulated infrastructure; Agent packages the infrastructure into modular, embedded and conversational financial products; and Global extends our reach through selected international investments and local partnerships. We intend for the three engines to share technology, compliance processes, distribution and transaction flows, which may reduce implementation complexity for clients, improve operating leverage and create opportunities to cross-sell additional capabilities. Our ability to realize these benefits depends on successful execution, client adoption, regulatory approvals, commercial agreements and market conditions.

Bakkt Markets

Bakkt Markets enables financial institutions, financial technology firms and digital asset businesses to integrate digital asset trading, payment and treasury capabilities through our platform. Our services span digital asset trade execution and liquidity access, stablecoin on- and off-ramps, payment and settlement, custody and treasury solutions, and related operational support. These services are offered as a menu of modular capabilities: clients can integrate through application programming interfaces ("APIs") or through interfaces designed for AI-agent access, including Model Context Protocol ("MCP") server or Tools and can activate only the modules they need without rebuilding the underlying technology and compliance infrastructure.

Our cross-border payments solutions are designed to address long-standing inefficiencies in international payments, including foreign exchange costs, failed transactions, hedging costs, settlement speed and limited auditability. By enabling faster, programmable settlement, including for currency corridors outside the largest global currencies, we believe our solutions can reduce transaction and hedging costs for clients, improve transparency and auditability, and allow clients to use accelerated settlement as a commercial advantage, including in negotiating payment terms with their own counterparties and suppliers. We believe these capabilities expand the range of payment flows our platform can address.

Bakkt Markets is supported by licenses and registrations held by our operating subsidiaries, including pan-U.S. money transmitter licenses and a New York BitLicense, together with our compliance, security and risk-management framework. The permissions available under any license or registration vary by jurisdiction and activity, and certain services depend on third-party banks, custodians, liquidity providers and other counterparties. Our Markets revenue currently is generated principally from digital asset transactions and is sensitive to client mix, trading activity, digital asset prices and spreads.

Bakkt Agent

Bakkt Agent is our AI-native financial services layer. It takes the regulated capabilities delivered through Bakkt Markets' APIs and puts an intelligent agent in control of them — using AI to interpret intent, orchestrate multi-step financial actions, and execute transactions on a client's or end user's behalf across onboarding, funding, payments and settlement, together with the compliance processes that support them. Clients embed these agentic capabilities in their own products on a white-label basis, through conversational interfaces or direct integration, to deliver financial services driven by intent rather than manual coding or workflows.

We are developing three principal product configurations: a modular neobanking-as-a-service stack, white-label card and credit card programs, and agentic cross-border transfers. Through the neobanking-as-a-service offering, businesses would be able to use our technology and regulated infrastructure on a white-label basis to offer programmable finance and account-based products to their end customers, subject in each case to applicable licensing, bank partner, network and regulatory requirements. Certain infrastructure modules are available, while other products remain in development or are subject to partner, bank, network or regulatory requirements.

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Bakkt Global

Bakkt Global is our strategy for extending our technology, brand and infrastructure into selected international markets through strategic investments and local partnerships. We seek opportunities in jurisdictions with established or developing regulatory frameworks, liquid capital markets and demand for digital financial infrastructure. Our current strategic Global investments are in Bitcoin Japan Corporation, a Tokyo Stock Exchange-listed company (TSE: 8105), and Transchem Limited, a BSE-listed company in India (BSE: 500422). These investments are intended to complement our other business engines by extending our technology, infrastructure and commercial capabilities into selected international markets. We expect to leverage our infrastructure in these markets and, over the medium term, we expect these strategic investments to create meaningful opportunities to grow our platform. These opportunities are subject to local regulations, required approvals and commercial execution, and their timing and financial impact are uncertain.

The value and strategic benefit of these investments depend on market prices, foreign currency exchange rates, the performance and governance of the investees, regulatory developments, and the completion of contemplated corporate actions.

Second-Quarter Highlights and Trends

The following developments were significant to our business and results during the second quarter and first half of 2026:

•We completed the acquisition of Distributed Technologies Research Global Ltd. on April 30, 2026 in an all-stock transaction and began consolidating its results as of May 1, 2026. We integrated its payment, stablecoin, onboarding and compliance technology into Bakkt's platform and subsumed the pre-existing commercial agreement into the combined company. The acquisition affects period-to-period comparability because our results for the three and six months ended June 30, 2026 include two months of the acquired operations, while prior periods do not.

•We continued consolidating onboarding and identity processes across our product modules and enabled additional wire and ACH funding capabilities. These capabilities are designed to support digital asset trading, stablecoin conversion, fiat transfers and cross-border settlement through a common infrastructure layer.

•Following receipt of required Indian regulatory approvals, Transchem allotted 47,500,000 warrants to Bakkt in June 2026. We initially paid approximately $9.4 million, representing 25% of the aggregate subscription amount, and the remaining aggregate subscription amount payable upon full exercise was approximately $28.2 million as of June 30, 2026. The warrants may be exercised in one or more tranches during an 18-month exercise period.

•We acquired Gyzer and brought its embeddable fiat-to-crypto on- and off-ramp embedded user interfaces onto our platform, connecting it to our stablecoin and onboarding infrastructure. This allows clients to enable stablecoins purchase and sale directly into their own applications and adds a new channel for transaction volume across the platform. The acquisition also brought experienced leadership and an operating team across engineering, compliance and sales into Bakkt, including Daniel Ishag, who joined as our Chief Commercial Officer.

Digital Asset Market Developments

During the second quarter of 2026, the regulatory treatment of digital assets continued to evolve and has drawn significant attention from legislative and regulatory bodies around the world. Recent developments relating to digital assets and cryptocurrency include the adoption of the Guiding and Establishing National innovation for U.S. Stablecoins Act (the “GENIUS Act”) and the proposal of the Digital Asset M

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Item 7. Management’s Discussion And Analysis Of Financial Condition And Results Of Operations

The following discussion and analysis of financial condition and results of operations should be read together with our audited consolidated financial statements and the related notes included under Item 8 of this Form 10-K (this “Report”). References in this section to “we,” “us,” “our,” “Bakkt” or the “Company” and like terms refer to Bakkt, Inc. and its subsidiaries for the years ended December 31, 2025, December 31, 2024, and December 31, 2023, unless the context otherwise requires. Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements. Such forward-looking statements are based on the beliefs of our management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those contemplated by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those factors discussed above in “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors.”

On July 23, 2025, Bakkt Opco Holdings, LLC (“Opco”), a wholly owned subsidiary of the Company, entered into an agreement to sell all of the issued and outstanding equity interests of Bridge2 Solutions, LLC, Aspire Loyalty Travel Solutions, LLC, Bridge2 Solutions Canada, Ltd., and B2S Resale, LLC (collectively, the “Acquired Companies”) to Project Labrador Holdco, LLC, a wholly owned subsidiary of Roman DBDR Technology Advisors, Inc. (the “Purchaser” or "Roman"). These entities comprised our loyalty and travel redemption business (the “Loyalty Business”). The sale transaction closed on October 1, 2025, which completed a part of our strategic transformation into a pure-play digital asset infrastructure platform.

In accordance with United States generally accepted accounting principles (“U.S. GAAP”), Bakkt management determined that the Loyalty Business met the criteria for classification as held for sale and a discontinued operation as of September 30, 2025. This determination was based on management’s commitment to a formal plan to sell the business, the significance of the business to the Company's historical operations, and the expectation that the sale will result in the elimination of the operations and cash flows of the Loyalty Business from ongoing operations. As such, the results of operations, financial position, and cash flows of the Loyalty Business have been reclassified and are presented as discontinued operations for all periods presented, where applicable. Assets and liabilities related to the Loyalty Business have been reclassified as held for sale in the consolidated balance sheets, and the related operating results, including any gains or losses on the sale, are reported separately from continuing operations in the consolidated statements of operations for all periods presented. Refer to Note 3, Discontinued Operations, in the notes to the accompanying audited consolidated financial statements for further information.

Overview

In this section and elsewhere in this Form 10-K, we use the following terms, which are defined as follows:

•“Client” means businesses with whom we contract to provide services to customers on our platform, and includes financial institutions, hedge funds, merchants, retailers, third party partners, and other businesses (except in the accompanying notes to the consolidated financial statements, where we refer to revenue earned from customers, instead of clients. The term customers is in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”)).

•“Digital Asset” means an asset that is built using blockchain technology, including virtual currencies (as used in the State of New York), coins, cryptocurrencies, stablecoins, and other tokens. Our platform enables transactions in certain supported digital assets. For purposes of this Form 10-K, we use digital assets, virtual currency, coins, and tokens interchangeably.

•“Customer” means an individual user of our platform. Customers include customers of our clients who transact in digital assets through, and have accounts on, our platform (except as defined for ASC 606 purposes above).

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Founded in 2018, Bakkt, Inc. (the “Company”) builds digital financial infrastructure designed to support institutional participation in the digital asset economy. During fiscal year 2025, the Company undertook a strategic transformation, focusing on divesting non-core assets, simplifying our corporate and capital structure, and investing in infrastructure to support our core platform. These initiatives are intended to improve our operating efficiency, align our business with our long-term strategy, and position us to scale our technology and services.

Our long-term strategy is to build and scale an integrated financial infrastructure platform through our three solutions: Bakkt Markets, Bakkt Agent, and Bakkt Global. We intend to expand our trading and payment infrastructure, develop software that enables institutions and customers to integrate and operate artificial intelligence-driven financial services through our platform, and invest in regulated entities in key jurisdictions. This strategy is designed to support institutional adoption of digital asset trading, stablecoin payments, and related financial services.

Our solutions include:

Bakkt Markets - Bakkt Markets enables institutions to launch secure, compliant, and advanced digital asset brokerage, trading and payment capabilities through a plug-and-play platform. It provides access to digital asset trading, stablecoin on- and off- ramps, custody integration, liquidity, and payment infrastructure through a unified technology stack designed to reduce the time, cost, and complexity of building these capabilities internally.

Bakkt Markets is supported by Bakkt’s regulatory licenses, compliance framework, and global settlement infrastructure, allowing customers to offer digital asset services to their end users while relying on Bakkt for trade execution, order and payment routing, funding, and operational support. This solution is designed to serve financial institutions, fintech platforms, and digital asset companies seeking to enable digital asset functionality within their existing customer experience.

Bakkt Agent - Bakkt Agent provides institutions, with plans to provide direct to consumer, with programmable access to Bakkt’s financial infrastructure through an intelligent software layer that coordinates onboarding, account creation, funding, and global money movement. Bakkt Agent utilizes automation and software-based agents to facilitate functions such as customer onboarding and identity verification, virtual account issuance, stablecoin and fiat payment rails, and domestic and cross-border payouts through application programming interfaces (“APIs”) and configurable workflows.

Bakkt Agent is designed to simplify the integration and operation of financial services by abstracting operational and technical complexity and enabling customers to programmatically initiate, manage, and monitor financial transactions, settlement, account activity, and compliance processes. Bakkt Agent’s modular architecture allows institutions to embed financial capabilities into their own applications and systems, supporting faster product deployment, operational efficiency, and the ability to scale financial services across multiple jurisdictions and payment networks.

Bakkt Global - Bakkt Global enables Bakkt to expand its technology and infrastructure into international markets through strategic investments in jurisdiction-specific entities operating in regulated financial markets. These investments are intended to establish a local presence in jurisdictions with established regulatory frameworks, providing Bakkt with access to licenses, regulatory permissions, and operating capabilities required to offer digital asset trading, payment, and settlement services.

Through Bakkt Global, Bakkt seeks to extend its trading infrastructure, stablecoin and fiat payment rails, and settlement services into new geographic markets through strategic investments in locally regulated entities. This approach enables Bakkt to access additional liquidity, customers, and financial networks while operating within local regulatory frameworks and supporting geographic diversification.

Digital Asset Market Developments

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The digital asset landscape underwent a fundamental shift in 2025, transitioning from a speculative retail market into the foundational architecture of global finance. This shift was defined by legislative clarity and formation of global standards for compliance, institutional integration, and the utilitarian expansion of stablecoins.

Widely considered one of the most significant pieces of digital asset legislation to date, the passage of the GENIUS Act in July 2025 created a federal regulatory framework for payment stablecoins. Further, the GENIUS Act clarified that payment stablecoins are neither securities nor commodities, removing them from SEC and CFTC jurisdictions. It also requires issuers to maintain 1:1 backing with high-quality liquid assets, such as U.S. dollars or short-term Treasuries, and to publish monthly reserve attestations. Establishing a federal framework provided regulated banks with a clear pathway to integrating stablecoins into existing payment infrastructure.

In 2025, the digital asset markets saw fluid trends influenced by a mix of global trade tensions. As of early 2026, the digital asset markets appear to be in a similar dynamic environment, but has gained support from institutional holders; growth accelerated by the SEC’s 2025 rule changes including the rescission of Staff Accounting Bulletin 121 (“SAB 121”) which significantly reduced capital and risk management constraints, paving the way for major banks to expand custody offerings.

Beyond regulatory progress, the industry continued investing in real-world use cases. In 2025 and early 2026, Real World Assets (“RWA”), specifically the tokenization of private credit, government bonds, and equities, continued to gain traction. NYSE and Nasdaq announced strategic initiatives to provide tokenized securities platforms to facilitate 24/7 trading and settlement of U.S. listed equities and ETFs and is currently undergoing the SEC approval process. The market also saw the early emergence of "agentic payments," where AI agents use HTTP-native settlement standards to execute autonomous transactions, signaling a broader transition from digital assets as purely tradable instruments toward functioning economic infrastructure.

Another adoption trend In 2025 was the surge in Stablecoin adoption, driven by increased regulatory clarity. Adjusted payment volume grew 733% year-over-year, exceeding $9 trillion. By early 2026, adjusted stablecoin volume reached an annualized rate of $10.2 trillion, outpacing PayPal’s $1.6 trillion by more than 5 times. Consequently, major banks are integrating stablecoins into core settlement. Furthermore, corporate treasuries began migrating “idle cash” from zero-interest bank accounts into yield-bearing stablecoins which offer the security of a Treasury bill combined with the instant liquidity of a digital asset.

Recent Developments

February 2026 Registered Direct Offering

On February 27, 2026, we entered into a securities purchase agreement (the “Purchase Agreement”) with a single investor, pursuant to which we agreed to sell and issue to the Investor an aggregate of 3,024,799 shares of the Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”) and pre-funded warrant

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